Methanol

Methanol is a realistic alternative to the Hydrogen Economy. Its more toxic, but as a
liquid, its easier to transport and store. Unlike hydrogen, it
can be distributed via the same transport systems used for oil.
Additional benefits are that:

most of the technology for using methanol as a fuel already
exists

like hydrogen, it can be used directly in fuel cells to
generate electricity

internal combustion engines can be modified to run on
it.

A common feature of methanol, hydrogen and biofuels is that
all three are just ways of storing and transporting energy. They
are not primary energy sources because they all require large
amounts of externally provided energy to pumped into them during
manufacture.

Synthesis from natural gas

This is the current industrial production method but it is
only a viable methanol source while natural gas can be obtained
from fossil sources.

Pyrolytic decomposition of wood

This method was introduced in 1927 and used to produce
methanol as a fuel until it was displaced by oil-based fuels. A
pyrolytic reactor is operated as a gasifier by injecting air or
pure oxygen into the reactor core. This burns the biomass to ash
and releases gasses. After scrubbing, the resulting syngas which
is a mixture of hydrogen and carbon monoxide in an approximately
2:1 ratio, is reacted in the presence of catalysts at high
pressure and temperature to form methanol. This method produces
about 100 gallons of methanol per ton of feed material. This
process is carbon neutral because the methanol is derived from
biomass.

Synthesis from carbon dioxide and water

This process can be powered by nuclear or renewable energy. It
should be non-polluting and carbon neutral because the only
products are methanol and oxygen. At the time of writing
(November, 2012) there is one proof of concept system
running:

Air Fuel Synthesis,
a British start-up, is developing a process for producing
petrol from atmospheric carbon dioxide and water:

Carbon dioxide is captured by blowing the air into a
sodium hydroxide mist, which yields sodium carbonate and
water.

Water is split by electrolysis to get hydrogen.

Optionally, water from the atmosphere can be used. This
is obtained by cooling the incoming air and passing it
through a condenser.

The sodium hydroxide appears to be recycled, though
neither the waste products nor the process energy efficiency
are mentioned. Their development timetable calls for plants
capable of producing at least 10 tonnes of renewable fuel a
day by 2015: the current (2012) demonstrator produces one
litre of petrol per day.

The MTG process is proven technology which has been in use
in New Zealand since 1985. Unlike the better known Fischer-Tropsch
process, which needs significant energy input and, as a
result, has overall energy efficiency in the 25-50% range,
the MTG process is exothermic and 93% of the energy contained
in the methanol is retained in the final product.

There is a similar, but less advanced, project being run by
a Saudi firm in conjunction with Peter Edwards of Oxford
University's chemistry department.

The critical factor for this fuel production path is its
energy efficiency, but nobody is willing to discuss that.
Yet.